The role of costimulation in T cell repertoire selection has been studied. Mice with genetically altered expression of costimulatory molecules CD80, CD86, and CD40, or of the costimulatory receptors CD28 and CD154 are being analyzed for thymic development and expressed T cell repertoire. We have demonstrated that expression of CD40L(CD154) is critical to negative selection mediated by endogenous mtv gene products. Two pathways of negative selection have been identified. One pathway is CD40L-dependent and acts at a relatively early stage in intra-thymic development and is mediated by a non-cell-autonomous mechanism. The second is CD40L-independent and occurs later in intra-thymic or post-thymic development. We have also demonstrated a requirement for CD28 costimulation in the induction of both deletional and anergic tolerance to male-specific antigens in pregnant male antigen-specific TCR-transgenic mice. Function of costimulation in positive selection has been addressed by genetically engineered deletion or over-expression of costimulatory receptor/ligand molecules. Combined deletion of CD28 and CD154 pathways significantly altered positive selection of mature single positive T cells. The transgenic over-expression of CD28 and CD86 had dramatic effects on thymic maturation, leading to differentiation of CD4+CD8+ thymocytes in the absence of TCR expression, suggesting a previously undescribed ability of costimulatory signaling to drive T cell development.